From The Editor: Trust – Supply Chain’s Weakest Link

October 1, 2005

A s all sectors of the textile industry search for new ways to compete, new markets to
enter and innovation to obtain a competitive edge, one parameter that rarely makes the paper is
trust. Today, companies rely on speed, quality and delivery in ever tighter time frames across the
supply chain. They share the growing need to work together in truly innovative product development.
Each must develop relationships that go beyond a contract and embrace real partnership as a
critical ingredient. Growing interdependence of companies isn’t new, but collaboration is the
buzzword for Western Hemisphere companies trying to establish a framework to counter increasing
Asian competition.

For a US business person, this is a
nice idea, but competition, the drive to win and no team structure in the linked businesses of the
supply chain make trust seem naive. The stakes have never been higher, and the chain can easily
break, damaging a customer relationship with one failed promise, missed delivery or misrepresented
capability.

At the recent American Apparel
Producers’ Network (AAPN) meeting in Savannah, Ga. — an event that gathered 75 companies from fiber
to apparel brands and finance to logistics — it was amazing to see so many different companies
searching for ways to establish new, trusting relationships. Old friends were apparent, but the new
demands of the apparel supply chain can test even those relationships. Innovation and collaboration
are a recipe for success for the Western Hemisphere in supplying apparel. Several AAPN members
expressed interest in forming a cooperative, a partnership of companies to remove excess capacity
from existing facilities and pool those resources to add capacity in Central America where there is
a perceived need. As you can imagine, an interesting dialogue ensued — but that is the point. Those
not willing to come together in the form of a cooperative are forced to develop a solution that can
perform at the level of a cooperative — finding partners with common ideals, identifying a need in
the market and developing a supply chain solution to solve it, gaining ground on foreign
competition by leveraging every aspect of the chain. Use finance, use logistics, leverage core
competencies and bring fresh product to the table — simple? No, but these steps are absolutely
necessary.

Some companies are doing this. They have developed and continue to develop new products and
processes. Some spinners have developed strong relationships with brands, and when they succeed,
members of the chain with which they have shared success in the past are in line to share new-found
success — they earn trust each time.

Jeff Streader, VF Imagewear, was clear at the AAPN meeting in his call for innovation,
saying: “Bring it to me. If I can use it, and you don’t have a chain, I’ll plug you into my chain —
but bring it to me.” Streader said he expects VF — now with roughly $6 billion in annual revenues —
to continue to source 50 percent in the Western Hemisphere — that is the opportunity and also the
challenge.

Building trusting partnerships that emphasize collaboration and innovation will establish a
clear competitive framework for the Western Hemisphere — trust may just be the weakest
link.